Forbes readers may be more familiar with Rosebank the whisky, than Rosebank, the biggest undeveloped oil field in the North Sea, 80 miles north-west of the coast of Shetland. Its owners claim is could produce as much as 500mn barrels of oil over its lifetime, providing as much as 7 – 8% of the U.K.’s oil over the next few decades.
Scotland’s Court of Session announced yesterday that approval for development of the Rosebank oil field off the coast of Shetland should now be overturned, meaning that it is no longer technically valid. The judge ruled that “the private interest of members of the public in climate change outweigh the private interest of the developers.”
The Hon. Lord Ericht’s ruling states that Rosebank can’t proceed without accounting for climate impact. In other words, the significant emissions caused by burning Rosebank’s oil should have been taken into account when it was given approval.
“From an investor perspective, the long-term justification for capital expenditure on drilling new oil and gas sites in the North Sea like Rosebank has dwindled away,” said James Alexander, CEO of the UK Sustainable Investment and Finance Association. “Renewables have overtaken oil and gas as the cheaper alternative, demand projections are changing. The UK’s key growth sectors of the future are in renewable energy.”
Historic Climate Ruling
Last June, the U.K.’s Supreme Court ruled that ministers had to take account of the climate impacts from burning the oil and gas extracted by drilling in the UK before issuing licences.
The climate campaigners Greenpeace and Uplift had accused the former Conservative government of having unlawfully given the Norwegian oil giant Equinor a licence to exploit the Rosebank oilfield, which sits 80 miles (130km) north-west of Shetland and holds nearly 500m barrels of oil and gas. The Conservative government gave the go-ahead for a round of new exploration licences in 2023.
Greenpeace and Uplift estimated that the Rosebank oilfield would release more CO2 than the annual emissions of the world’s 28 poorest countries combined, including Uganda and Mozambique. Uplift says that burning Rosebank’s oil and gas reserves would create more than 200 million tonnes of CO2, more than the 700 million people living in the world’s low income countries produce a year.
They had also asked the court to cancel the licence to a Shell subsidiary to drill for gas in the Jackdaw oilfield in the North Sea. The Court heard that combined emissions from Rosebank and Jackdaw, if they continued to be allowed to operate, would likely be responsible for approximately 32,000 additional heat related deaths until 2100.
Rosebank is said to contain up to 300 million barrels of oil and is owned by Norwegian energy giant Equinor and British firm Ithaca Energy.
If Equinor and Ithaca submit a new application for Rosebank, the British Energy Secretary will have to remake the decision whether or not to develop it, but this time assessing the field’s scope three emissions. The oil companies can also appeal the court’s decision.
The independent advisory Climate Change Committee has said that while ending North Sea exploration would signal the U.K.’s commitment to the 1.5% temperature increase target, it could be better for the environment if the U.K. produced more oil at home than importing it.
However, the committee concluded that while the U.K. will continue to need some oil and gas till it reaches net zero, this would ‘not in itself justify the development of new North Sea fields.’
Work underway in the North Sea can continue but for now, the Shetland Isles and campaigners can celebrate a significant legal victory and legal precedent.
MPs argued Rosebank would produce 200m tonnes of carbon dioxide, more than the combined annual CO2 emissions of all 28 low-income countries globally.
By 2030, Rosebank could produce almost 8% of all U.K. oil and gas.
Dr Ewan Gibbs, Energy Historian, University of Glasgow commented:
“We’re now deep into the late North Sea era. Production has taken a massive nosedive in the past ten years and developing Rosebank won’t change that. Nor will it lower energy bills, or stem the decline in offshore employment.
“When it comes to ensuring a just transition, the Westminster and Scottish governments want to tell a story where everyone wins. but I don’t think it’s possible. I think there’s a world where workers can win, but I don’t think [Ineos boss] Jim Ratcliffe can too.”